Are Christmas and year-end bonuses a given in Europe?

How many employees receive a Christmas bonus (13th salary) and year-end bonuses? What is their average amount? Paylab took a detailed look at the standards and conventions in individual European countries where this international salary portal maintains a strong network of local salary portals.

The end of the year brings with it the year’s most beautiful holidays and the opportunity for businesses to review their performance in 2017. Financial statements are getting closer and managers assessperformance based on defined plans, while making an effort to express their thanks for the effort shown by their employees.

Every company has its own tried-and-true practices and ways to reward those who work for them.

Paylab decided to examine financial benefits in detail.

In general, financial benefits are in no way a given. Most employees can only dream about financial benefits at the end of the year. Receiving a bit of extra cash in the form of financial bonuses outside the scope of an agreed basic salary is not a common practice in businesses. Employers more often choose other forms of non-financial benefits, such as Christmas dinners and parties, St Nicholas Day celebrations for employees’ children, small gifts or gift vouchers. Compare the salary conditions in your current job with others.

Christmas bonuses are the most generous in Central Europe

Christmas bonuses are especially welcome before Christmas shopping. These bonuses are a mandatory salary component agreed upon in an employment contract. Employers use to show workers appreciation and are usually ment as a gift. A majority is defined as a specific percentage of the basic salary and these extra funds are paid out with the salary for December before Christmas itself.

Christmas bonuses are among the sample group most widespread in Croatia, where up to 44 percent of employees receive such a bonus, but the actual amount of the bonus itself is not so high. Typically, the bonus is around 23 percent of a Croat’s basic salary, which is a gross bonus of around €185 on average. Christmas bonuses are also widespread in Slovenia, with a third of employees receiving one; the amount is a bit higher than in Croatia at roughly 31 percent of the basic salary (€422 on average). In the Balkans, Christmas bonuses are a bit less common in Bosnia and Herzegovina (15 percent) and Serbia at 8 percent, but the percentages are much higher than in Croatia or Slovenia. In Bosnia, the Christmas bonus is 78 percent of the basic salary (€625) while in Serbia it is up to 86 percent of the basic salary (€481).

In Central Europe, Christmas bonuses are a bit less common, but the amount of the bonus itself is much more generous. People can certainly look forward to a bigger shopping bill when they receive a gross bonus of €720 to €850 on average (except Poland where the bonus is not so generous). 19 percent of employees receive this bonus in Poland, 17 percent in Slovakia, followed by 14 percent in the Czech Republic and 13 percent of employees in Hungary.

Hungarians receive the most generous bonus from all countries at up to 91 per cent of their basic salary.

In the Baltics, 10 to 13 per cent of employees receive a Christmas bonus, while the amount does not exceed a fifth of their basic salary, i.e. a gross bonus of €173 to €210. In the Nordic countries, a Christmas bonus is the least common in Finland, with only 4 percent of employees receiving one. The bonus itself typically does not exceed 21 percent of a Fin’s salary.

Year-end bonuses tend to be more generous than Christmas bonuses

Bonuses/commission are optional salary components that are largely understood as a profit-sharing bonus and are individually defined performed – based on achieving specific goals. They are typically paid at the end of the year once it is known if a business has generated the desired level of profit. There are also companies that pay these bonuses out on a quarterly or biannual basis, or once a project is finished. Gain an overview of salaries for your job in your region.

In general, year-end bonuses are the most widespread and generous in management positions, particularly among executive management, given they are often connected to the achievement of defined objectives. 21 to 45 percent of people in top management report that they receive year-end bonuses that often exceed twice their basic monthly salary. All employees in this group work at the highest levels of management in various companies, from small family-owned companies to large corporations. Year-end bonuses are also common in low- and middle-management but are a bit more modest.

Among the monitored countries, year-end bonuses are most widespread in the countries of Central Europe, where around a quarter of employees receive an average bonus of 69 to 86 percent of their basic salary. Croatia and Slovenia were the most modest countries among the sample group, with bonuses equal to around half of the basic monthly salary. These bonuses were least common in Serbia, where they are received by only a tenth of employees, but they were the most generous among the sample group, reaching 114 percent of the basic salary on average (€645).

Regular bonuses are much more common in Finland despite the relative uncommonness of a Christmas bonus. Around 19 percent of employees receive such a bonus at a level of 78 percent of the basic salary (€2365).

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